NFL labor fears affect deals for execs, coaches

Some NFL clubs are asking top-level employees to take pay cuts
as steep as 50 percent or agree to be terminated with little notice if there is
a work stoppage in 2011.

Clauses to that effect began appearing in coaches’ contracts
about six months ago, and have been included in contracts of other high-level
NFL club employees as well, sources said, including contracts for scouts and
high-level business-side executives.

The NFL
collective-bargaining agreement with players expires in March 2011, and owners
are expected to lock players out if there is no deal. That would mean little or
no work for thousands of other NFL club employees.

The vast majority of
non-player employees at NFL clubs can quit or be fired “at will,” and do not
have employment agreements. But many top executives on the business side have
contracts, as do all general managers and coaches.

Many of the work-stoppage
clauses differ from club to club but some of the same language appears in
multiple contracts, said Larry Kennan, staff director of the NFL Coaches
Association, a trade association that represents the about 600 NFL coaches,
from head coaches to the lowest-level assistant coaches.

THROWN FOR A LOSS?

Some clauses in recent contracts of top team executives, coaches and general managers give clubs new rights to cut compensation and terminate contracts. Some examples, according to multiple sources, include language allowing clubs to:

Reduce, terminate or suspend the contract on 20 days’ notice.

Reduce salary by 50 percent if the lockout continues for more than 90 days.

Terminate the employee without pay on 60 days’ notice.

Extend the contract another year at same terms as 2011 if at least eight NFL games are canceled.

“There are multiple
contracts with the same terms. For instance, a lot of them have that the club
can impose a 25 percent salary reduction in the event of the lockout,” he said.

The language in some
contracts goes even further, according to multiple sources (see box).

NFL spokesman Greg Aiello
declined to discuss the contracts of team coaches or executives, saying, “The
terms are negotiated individually by the clubs and the employees.” He said he
was not aware of similar language being inserted into the contracts of league
employees.

Aiello declined to estimate
the number of club employees at the 32 NFL teams, but industry sources said
many NFL clubs employ about 100 people and sometimes more.

The number can vary greatly
depending on whether the club owns and operates its stadium or is a tenant in a
government-owned stadium, said Marc Ganis, president
of SportsCorp. Ltd., a
Chicago-based sports business consulting firm. Employees in football
operations, including the entire coaching staff, are contract employees. “And
then, on the business side, you will have your executives, your top marketing
people, your top financial people, your top administrator [under contracts],” Ganis said.

During the last major work
stoppage in sports, the 2004-05 NHL lockout, about
1,000 jobs were eliminated at NHL clubs, business partners and the league
itself. Some clubs chose not to lay off any employees while others did, and
many employees whose compensation was based on sales commissions quit. At one
club, the Dallas Stars, upper management, including full-time scouts and
coaches, took 20 percent to 25 percent pay cuts.

Kennan said many coaches
are not aware of the new contract language because they haven’t negotiated
their contracts for the potential lockout year. He did say that some of the
language in the contracts ties coaches down. “In most cases the club is saying
we can renew this thing when the lockout ends,” he said. On the other hand,
there are some clauses which allow coaches to work in college football, he
said.

Some coaches are refusing
to sign contracts that contain the work-stoppage language, according to Kennan
and agents who represent coaches.

Agents, who spoke on
condition of anonymity because they feared reprisals against their clients, say
some coaches have fought successfully to get the lockout clauses stricken.
“Like anyone else, it depends on how much leverage you have and if a team wants
a coach badly enough,” one agent said.

Unlike NFL players, NFL
coaches are not part of a collective-bargaining unit and have no union to fight
against the changes in their contracts. (The NFL Coaches Association is funded
by dues, which about two-thirds of the 600 coaches pay voluntarily. The
association is not funded by the NFL Players Association, but the players union
provides office space and services, including administrative and legal
services, to the coaches group.)

Kennan said coaches are
upset about the new contracts and feel caught in the middle between owners and
players.

“I don’t want to say we
will be on the players’ side,” Kennan said. “We will be on the side that will
be most friendly to coaches. If the owners are trying to lock us out, that is
not very friendly.”